Following a review of Olympia Trust Company's ("Olympia") mortgage business practice, Olympia has made the following changes, effective immediately.
If you or your clients ever engage in private loans through registered plans like RRSPs, here are some brand new rules from the biggest registered plan trustee, Olympia Trust.
Starting immediately:
- An independent third-party administrator will be required for any Mortgage Investment where the Mortgage Broker is a related party to the borrower.
- Any Syndicated Mortgage, ( two or more lenders in the same loan ) Investment will require the following:
- A licensed Mortgage Broker to broker the Mortgage Investment for it's duration or;
- An Independent third-party Administrator to administer the Mortgage Investment for the duration, and;
- Olympia reserves the right to request an Independent third-party Administrator for any new mortgage.
Although Olympia is not making any official comment, I believe the main effect of these rule changes will be to provide better protection to lenders who don't really know how to lend. On the flip side, it will definitely make setting up and running a syndicated mortgage more expensive and time-consuming.
Cheers,
Barry
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